FICCI welcomes relief measures announced by Finance Minister, it is a good first step

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    New Delhi: “FICCI welcomes the relief measures announced by the Finance Minister with respect to the tax and statutory compliances amid the lockdown imposed to contain Covid19,” said Dr Sangita Reddy, President, FICCI.

    Moratorium of six months to companies for filing of disclosures on MCA portal and extension of time for holding board/Independent Directors meeting within prescribed timelines will bring relief to corporates, all of which are facing complete disruption in functioning. “Taking cognizance of the liquidity issues being currently faced by corporates, deferment of Deposit Reserve and statutory investment for debenture redemption is a welcome step,” she added.

    Announcements on the tax front will give reprieve on compliance front.

    “MSME sector, which is precariously reeling under the impact of Covid19, would greatly benefit from the increase in the threshold for triggering IBC against delay in payments. FM’s assurance that if situation prolongs, government may consider suspending IBC is a welcome announcement,” said Dr Reddy.

    FICCI has represented many other issues to the Ministry of Corporate Affairs over the past few days and would like to re-iterate the following for immediate action:

    Corporates are finding it extremely challenging to ensure compliance with the requirement of Companies Act 2013 and Rules framed thereunder and are at a risk of non-compliance for no fault of theirs. Examples include timely conduct of board evaluation, discharge of CSR obligation, transfer to IEPF, addressing shareholders’ requests for demat etc. on a time bound basis. Allowing an additional period of 3 months to companies to ensure timely compliance without any penalties being imposed would be very encouraging in the current situation.

    Extension of financial year to a period of 15 months will also enable companies to close the books as on 30th June 2020 instead of 31st March 2020. Financial Statements as on 30th June 2020 would reflect a true and fair value of the affairs of reporting entities as compared to the books drawn on 31st March 2020.

    Holding of General Meetings in the absence of physical quorum should also be allowed uptil 30th September 2020.

    We look forward to further announcements by FM on economic package and further relief measures to keep the economic engine going, said Dr Sangita Reddy.